June 24, 2015

Vermont Governor Peter Shumlin (D) last week signed House Bill 40, a new law designed to reset Vermont’s renewables programs and give utilities incentives to increase their use of renewables while cutting residential customers’ greenhouse gas emissions.

The legislation creates mandates for 55% renewables by 2017 and 75% renewables by 2032 for electric utilities. The new, more demanding renewables standard is also expected to reduce complaints that some of Vermont’s power producers’renewable energy credits (RECs) are counted twice, once for in-state credit and again when sold out of state.

The new law promises to create an “energy transformation” by legalizing solar leasing and on-bill financing of home energy efficiency upgrades like high-efficiency pumps for space or water heating.

HB 40 was named RESET because it changes the target of the state’s
policy. Instead of just driving the use of renewables, it now includes
provisions for cutting emissions from home energy use and from the
transportation sector, which combined account forover 75% of Vermont’s greenhouse gases.

The Vermont Public Service Department’s 2014 Total Energy Study was the basis for the new law’s
standard and innovations. It’s most fundamental conclusions were that business
as usual would not achieve the state’s renewables targets and emissions
reductions goals but a RESET could achieve them without compromising the
state’s economy.

Vermont’s previous renewables program allowed utilities to
sell RECs and also count them toward a voluntary goal. A Vermont Law
School group alleged Green Mountain Power, the state’s dominant
electricity supplier, was misleading customers with the claim it was using
renewables while it was, in fact, selling the RECs. Last year, both
NextEra Energy and the Connecticut legislature stopped the purchase of Vermont RECs and the New
England market for Vermont RECs has slowed significantly. Federal
regulators subsequnetly instructed the utility to be more clear going
forward.